Advise re MTD
Summary: The discussion centered around the implementation of Making Tax Digital (MTD) and the challenges individuals face transitioning from manual to digital accounting. Participants like simplyessential_uk and sheba-knows-best shared their experiences and concerns about using platforms like Clearbooks for recording and submitting taxes, emphasizing difficulties with software navigation and data input methods. There were clarifications about the necessity of recording transactions daily versus monthly and a consensus that misinformation about MTD requirements is circulating online. Participants expressed frustration with the system's complexity and lack of intuitive guidance, highlighting the need for more support and accurate information.
I fall into the new MTD 2025-26 - Watched the HMRC Webinar and all good. Im a small business proprietor so never used an accountant in 25yrs of being Self employed so please do reply with "speak to an accountant" I use a basic cash basis reporting
So Ive been using Pandle free version for a couple of years, prior to that used Excel. I would summerise total Incomings Vs outgoings and declare profit - Simple. Pandle arent sure if they are doing a free software for the MTD, but the pro version is only £5 and links to bank account transactions, HMRC recommend several companies so Im just now info gathering.
My Q is do I need a software that links to Ebay (and Amazon) to pull in all the buyer transactions? Do I need to even upload all the individual transactions or is the total from Ebay etc all they want under the new MTD? therefore the Pandle Pro software is enough. (I dont want to sign up for an account package then find this is quite an important feature of the quarterly reporting) Ive looked at Sage - they have a basic free but also the £7 per month version which again if that is adequate then great, any advice from anyone in the same position would be appreciated.
miss_simply_crazy
·4 days agoAccording to Google AI that's not the case:
No, weekly sales totals are not compliant for HMRC under Making Tax Digital (MTD) when recording retail takings or daily sales.
HMRC Record-Keeping Rules for Sales
Daily Breakdown Required: You must record a separate digital sales figure for each individual day that you trade.
No Weekly/Monthly Lumping: Grouping your takings into weekly or monthly totals does not satisfy MTD requirements for retail businesses or VAT retail schemes.
Software Entry: Your MTD-compatible software must capture and maintain these individual daily gross takings (DGT)
sheba-knows-best
·4 days ago · EditedThis is what's driving me mad about the world at the moment - read it in AI and it has to be true... without double-checking the info. I did a very quick AI dive myself and it seems the above quote refers to HMRC/MTD and specific Retail Schemes.
Certainly, when I took time to read through HMRC guidelines myself previously and mentally applied myself - as well as coming back to these boards and double-check my info and comparing notes with other like minded diligent humans - there was no mention of daily record keeping.
I'll stick with the humans on this, I think, rather than worry myself sick over some AI vomit spewed out with god-knows-what prompt.
No offence meant to @miss_simply_crazy mind, all comments and heads up welcome, more just me screaming at an increasing level of human reliance on inhuman tech.
simplyessential_uk
OP4 days ago · Editedyou are correct @sheba-knows-best , I remember someone on here joining the HMRC webinar and asking that question and were told monthly is fine. At the end of the day, we are only having MTD pushed upon us to help tax due in forecasting and to mirror the VAT quarterly recording which has caught more ppl not paying the right tax. When we press Q1 to submit its only sending 1 set of figures and HMRC are not interested in daily transactions
@miss_simply_crazy Id ask AI to show you the link to where its obtained that info, I often do this with AI and find its getting info from wrong sources, chatroom or Reddit, so unless its HMRC or accountancy website, I would take it with a pinch of salt. I asked AI to help me with my family tree, as i was stuck and I was amazed when it found my missing relative with births, dates and lineage connections and even told me which catalogue records to find them inc page numbers to verify ...it was all lies and AI had made it up once I fact checked😆 So now I always ask it to only return results from official sources/factually correct with link to sources and ignore reddit, chatrooms and forums if Im looking for factual info.
justdivinegiftsangela
·5 days agoI thought I would be able to carry on entering monthy figures for MTD but according to google I need to record daily figures - is this correct?
sheba-knows-best
·5 days agoI don't know what you are reading on google but, in my opinion, there is no need for daily figures.
I have recorded income (sales less ebay fees) weekly due to using payouts; and expenses every 4 weeks (or monthly) due to using my spreadsheet.
The totals that HMRC will use will just add it all together anyway into 12 weeks or 3 months for Q1. So could probably just give income and expenses for 3 whole months if you wanted...
justdivinegiftsangela
·5 days agothank you !! glad we can just do monthly, I usually record gross sales less all expenses and put these 2 figures onto the self assesment but now with the MTD I am not sure how to record payouts as I don;t want them to be added to my gross figures if you see what I mean. I don't need to start MTD until next april but I am just trying to get my head around it. As an older lady I have always done manual accounts and just entered the total figures for the year on my self ass. I fully understand how ot record monthly figures for everything except the payouts.
sheba-knows-best
·5 days agoYou're where I was... I think...
I have an Excel spreadsheet where I record all daily sales (£ per item) and expenses each week (using different lines for PL, FVFs, the cost of the asset etc etc etc.)
But when I started thinking about how to do MTD, I realised that ebay payouts (rather than the sales figures on my items) was probably the most easy to prove income.
In the end (and not to terrify you) but I ended up cross-checking profit gleaned in three ways
1) Ebay payouts - minus all non-ebay expenses on my spreadsheet
2) Income according to my spreadsheet minus all expenses according to my spreadsheet.
3) Ebay quoted sales figures minus ebay quoted fees minus all other expenses (according to my spreadsheet).
I was relieved to see all three were within £50 of each other (and I aim for £80k) so I was happy to use no.1 - ie payout data as proof of income.
simplyessential_uk
OP5 days agoI just use the report under PAYMENTS>REPORTS and put in the months dates - Use the the Sales, Refunds, Postage and fees figures and I know they are correct as all my pots tally at the end (Money sitting in Ebay matches what CB tells me is in my Ebay payouts due to be paid out)
sheba-knows-best
·5 days agoHa! I didn't even know that was there! I use SELLERHUB / PERFORMANCE/SALES. Because here you see gross and net.
just checking.. Payments/Reports, this is referring to pay-outs right? Very confusing as order proceeds, less expenses wont match payouts half the time...
Honestly, talk about a hundred ways to skin a cat...
sheba-knows-best
·5 days agoIm talking gross and net ebay fees (nothing to do with tax)
simplyessential_uk
OP5 days agono the report gives you gross sales, returns and fees (feel its in the wrong place and should be under the reports tab) - its pretty new and used to have to download transactions to excel.
justdivinegiftsangela
·5 days ago · EditedI use the same reports at the moment but do my accounts on paper. I won't need to change until next year, I am just trying to get my head around it in advance. thank you for trying to help me ! I just confused as how to record the payouts without them being added to the gross sales.
simplyessential_uk
OP5 days ago · Editedif youre entering it manually you dont record the payouts, just ignore them and enter in manually your gross, your fees, your post and your stock, just like you used to do. You only need to allocate the payouts (to a holding pot if youre linking to your bank.
justdivinegiftsangela
·5 days agothats great thanks, I understand it now. thank you for your patience with me x
sheba-knows-best
·4 days agoWhilst I do agree theoretically - I don't trust ebay.
Ebay changes the data it throws up. I used to see it every year in December. I skirted dangerously close to 85k and then a few weeks later - not close at all. A weird blip. And if it does throw up oddities in its reported data (ie keeping some figures back here and there to suit its own reporting schedule) whether in reports or in performance data, you cant go back and say to HMRC - well, when I looked at the reporting figure in Q1, it said this, honest...
This is why I am reporting MTD with payouts (and I would advise everyone else to do the same). Payouts are the one thing ebay can't change/deny/fluff.
justdivinegiftsangela
·5 days agothank you for trying to explain, to be honest my head is mashed with all this but I appreciate you taking the time to explain.
simplyessential_uk
OP5 days agoYou have a choice of connecting to your bank (then managing the payout in the software) or using the software just to input your monthly figures. Just like the old yearly all you are doing is inputting your gross incomings and outgoing Fees, Postage and stock
I connect to my bank but it took me several months to make it tally as its constantly moving (I sell on Amazon, Tiktok and Ebay so there is always money transfering somewhere within the month) - I think i explained earlier in this thread about linking to the bank and creating pots - The pots are just holding the payouts outside the main ledger so you are "parking" them, I used AI and many sleepless nights trying to understand it - so its not easy to get to grips with but the benefit is if you have lots of suppliers etc it recognises them and allocates them automatically as expenses so saves me time manually inputting them - If you are not due to start until April you have time to try and get to grips and you can try
If you ignore linking to your bank and just treat the software as you would an excel spreadsheet and input all your expenses then at the end of the month input your sales & Fees it will be enough to just press the button - I selected monthly with HMRC (not 6th - 6th) so that makes recording easier
rainbowtrax
·4 days agoThat's what I've done. I'm not wasting any more time than I have to on this rubbish and I'm treating it with the contempt it deserves. So I decided to go simple, one entry for income for the entire quarter, one for total stock purchases, one for total postage, one for packaging materials purchased etc. I made about 6 entries and submitted it. If they don't like it, I'm sure they'll let me know.
sheba-knows-best
·4 days agoI agree...
...that MTD deserves contempt. That people who have been voluntarily contributing to society for years (when lots don't) get told to do it digitally, without being asked, or advised, regarding their digital literacy is a disgrace. HMRC is supposed to be a service, paid for by the tax-payer for the tax-payer, to support those less able to give. It should therefore accept tax returns in the way that suits the individual tax payer.
However, it is what it is.
And whilst I have nothing to hide, I hear that when they investigate they can go back 20 years or so nit-picking for evidence of everything you've ever earned/estimated/thought was 'close enough'. So I'm doing my damnedest to get this right too.
simplyessential_uk
OP3 days agoI think that applies to VAT MTD not IT MTD - Id check your source as mentioned above AI makes stuff up and pulls info from Chat rooms/Reddit etc. If its not on HMRC website Id be cautious. Nothing has really changed only quarterly recording
dwhairandbeautystore
·1 week agoI've just used the free version on Sage. I don't link up any of my accounts - I hate the idea of lots of different companies seeing all my private financial data!
You don't need to include any more info that you usually do on your tax return, you can submit it as total figures for income and outgoings as long as it's in the correct categories.
I just add everything up at the end of each month and fill it in manually. It only takes me 5 or 10 minutes.
sheba-knows-best
·1 week agoIt's true I could have been over thinking it. But I wanted to make sure that three versions of profit tallied:
ebay sales (according to ebay) minus ebay fees (according to ebay) minus my expenses
ebay payouts minus my expenses
ebay sales minus ebay fees minus my expenses (all according to my spreadsheet).
My issue was if you're not linking your bank account and you are unfortunate enough to be investigated you need to be able to prove stuff.
Having said that - it was Clearbooks that caused me the most problem, just working out how to edit for instance (there is no edit, you have to void). And it isnt easy where you add in your tax deductibles either. But heyho. I only compared Clearbooksm Quickbooks and Xero...
dwhairandbeautystore
·1 week agoI keep all my receipts and eBay keep my sales and fee data so I can always prove it if required.
By linking your bank account to anything, you are allowing full access to whatever you earn and spend to strangers.
sheba-knows-best
·2 weeks agoSo I just submitted my first Q1 for MTD. Hurrah.
I thought I'd bump this thread for anyone out there sticking their head in the sand and wishing it would all go away... there is help in this thread...
Overall - not happy with the software. It is not intuitive in my opinion. And I noted when I submitted there was no chance to resubmit. I followed @simplyessential_uk advice - and found a way to click on CLEARBOOKS and then a resubmit Q1 button did appear - but but because I am not linking my bank accounts it didn't seem much use... Hard to explain - but my advice?
Make sure you're happy before you one-click 'submit'. As I dodn't think you can change it if you are not linking your bank accounts.
Which does all seem to make my use of an accountant a bit redundant. As I say , not very helpful software, not much help available online or from AI and and all a bit suck-it-and-see.
simplyessential_uk
OP1 week agoI think it will get easier now the first Q1 is out of the way - I add mine monthly now so I can just add in expenses at the end of the Q2 and send - I bet alot of people are going to be in a panic - Im seeing so many posts on Instagram about MTD (moaning) and the comments underneath of people not knowing what they are talking about,
simplyessential_uk
OP1 month agoWell I submitted my first quarter BUT omitted the allowable expenses in error so had a full on panic for last hour - I couldnt get it to add on but just to let you all know you need to go to your "bank accounts" add account and select OWNERS account - I renamed it "EXPENSES" but you then add you manual expenses but select this as the "paid from" - It then will appear in your ledger to submit - I added them and then rebumitted - phew, all done for 3 months
sheba-knows-best
·1 month agoGood to know. Thank you. I thought though that you could just do allowable expenses at full year... presumably that is what my accountants will do... (as they will do for YE 5/4/25 in fact)
Also - from memory - I seem to recall that for the first year we were all being allowed to have an 'aha moment' and go back and alter past submitted accounts ie if whilst submitting 2nd quarter I realised I'd forgotten all about return costs (which I havent) I could go back and resubmit quarter one with additional cost.
Are you saying once Q1 is submitted that's it. No changes. ???
simplyessential_uk
OP1 month ago · Editedno i submitted Q1 in error,
I clicked to next page and next page to enter expenses then saw it said "disallowed expenses" which threw me then my finger slipped on the mouse and next minute its was "submitting" I always get the jitters when it comes to submitting to hmrc, been doing it 15yrs but never changes 😆 I panicked but finally found in the "submitting mtd" on front dashboard then click on your Q1 details the Hmrc is in grey but toggle to clearbooks and the "resubmit" button is in blue. It took me quite a while to work out how to enter my petrol and allowances etc as they just weren't appearing in the column on the resubmit page but I then read i had to record as above, then appeared🥳
Clicked resubmit. Read you can resubmit as many times as you want, but im guessing that would look odd if figures kept changing
I also wondered if I did it at year end or not but chatting to AI Looking at CB help pages it seems to go in with the quarter so perhaps your accountant goes in each Quarter and inputs those then resubmits.
I hope Hmrc give us some grace for mistakes but I read that was if you signed up early but now I've done it, looks correct except it says "taxable amount" on dashboard but of course personal allowance has to come off so that confused me but the figures should be correct in respect to what comes in and out.
Blimey its been a learning curve, but glad I've got my head around it finally 🤞
sheba-knows-best
·1 month agoWell - I'm going to submit mine right on the deadline (due to returns data). I'm not going to fiddle with allowances this year. See what the accountant makes of it.
I'm curious to see the fall out on this. I know so many people who are saying they have put their head in the sand and have yet to even investigate software... I wonder if HMRC are going to have to offer an amnesty for a year or something... I can't help feeling the volume of tax returns will be well down. I think I read 864,000 affected this year and over 2 million once it's everyone over 20k. We'll see...
sheba-knows-best
·1 month agoI just checked my email from accountants.... apparently they go in at the end to add allowances (as they do currently). SO I guess you must be allowed to do it that way too. Not saying that you should.
simplyessential_uk
OP1 month agoI must agree its not been easy - Yes HMRC have advertised the deadlines etc and companies are offering software but theres definitely a gap in the help and execution side of this.
rainbowtrax
·1 month agoDo either of you know how you do things carried over such as postage stamps in hand using the FREE version? I found instructions to use journal entries but that feature is only available on the paid for version.
Eg, I buy a bulk lot of postage stamps - what I was doing previously was totting up what was left at the end of the tax year then carrying that figure over as stamps in hand to the start of the next tax year. Likewise, stock figures. We generally do a stocktake at the end of each tax year and that gives us our opening stock for the next year and a calculation for cost of stock sold that year.
Do I have to effectively stock take and count stamps four times a year or is there a way to just do it once at the end of the year? Or can I enter a guesstimate for the first three quarters and set it straight with the exact figure in the last quarter?
simplyessential_uk
OP1 month ago · EditedIm a sole trader so use the cash basis accounting - so I just calculate any stock bought as an expense when bought - If I was buying the stamps in January that expense would go in prev tax year even if they would last until June. I think thats different for Ltd companies but Im not sure
rainbowtrax
·5 days agoApparently we just ignore stuff like that and only enter actual money in and out each quarter then set it all straight in the final annual submission. Likewise any things like petrol allowance or use of home as an office only get entered at end of year.
simplyessential_uk
OP1 month agoThe new AI summary for posts are now a bit pointless @sheba-knows-best
expressing apprehension ? 😆 I think this post touched more on the "How to's" of using Clear books
sheba-knows-best
·1 month agoI'm bumping this thread again) Mainly because I want people who are in need of help with MTD to find it easily).
... but actually the new layout seems to work okay when it is a serious topic under discussion (as in the offshoots seem easy to follow for people who come to a discussion a tad later)
justdivinegiftsangela
·2 months agoopps should read I was considering an accountant !
sheba-knows-best
·2 months agoHi
I don't wish to in anyway lessen what @simplyessential_uk has advised. It no doubt works well. However I used a way that does not involve linking bank accounts and I wonder if it will work better for you @justdivinegiftsangela I suspect we may have similar mindsets. I have always kept a spreadsheet which I suspect works like your manual ledger.
So you can opt not to link your bank accounts.
So in Clearbooks:
(no bank account links - you may just need to reset your business and start again)
select dashboard
Choose manually record income
Then record all income for April (payouts or use your sales tab on ebay. I initially went for the latter but am going to swap to payouts as that is something proven by my bank account and ebay cant change its mind later if i am investigated!). You do this manually. No proof needed.
Next choose manually record expenses (I had 5 rows: ebay costs, asset prices, postage, premises, returns). Again all manual - no proof needed.
That's it. To be clear - whilst all of this is manual, please keep paper or digital records. Because if they investigate the people not using the bank account option - we will need evidence!
justdivinegiftsangela
·2 months agosheba-knows-best
·2 months agoOkay
TOP TIP: Say you make an error? Dont do what I did and waste about ten hours tearing your hair out because, you're right, Clearbooks does not allow you to edit the figures once you input them. (You can only edit the text).
But fear not!
Just click on the REC0000 number at the beginning of the line that you want to change the numbers - that will take you to a new screen - top left in red is VOID (in a box). Click it. It will allow you to delete the whole line and input the details again.
DId someone say counterintuitive???
simplyessential_uk
OP2 months agoDId someone say counterintuitive??? 😆😆
I just put it down to not having an numerical brain - Accountacy software has made my head spin. Its been so frustrating but once it clicks then its easy, just got to go through the pain barrier of thinking your stupid and surely it cant be this hard
simplyessential_uk
OP2 months agothe manual system would be easier if you dont have lots of payments out to manually input - I buy postage via P2Go and Amazon and stock from various places so I find the link easier
If anyone else is reading this the pot system works like this:
You transfer the incoming payments from Ebay and park it in a side pot. So if you had £5000 NET sales dripped in over the month with various disbusements you would see your pot total as £5k at month end, but of course that is Net after any deduction of Fees/postage. So at the end of the month your Ebay pot is showing as -£5k (I know its counter intuative and that bit blows my mind and struggled with as its money in)
So at month end you go into the Ebay pot and type MONEY IN (Enter your gross sales) which lets say is £6000k and attach to the ledger as revenue. Then MONEY OUT your postage was £500 and Fees £500 (Thats £1000 - So thats the £5k in the pot accounted for) and your Ebay pot would then say £0 at month end - If however you have £100 still in Ebay ready to disburse your pot will say £100 and should match - Thats why the opening balance must match when you start OR transfer money over so its £0 then start as opening balance is £0
justdivinegiftsangela
·5 days agosheba-knows-best - if you record the ebay payouts from your bank they are net not gross - I don't understand how you would tally these up. I cannot enter the gross monthly sales figure and the payout figures? not sure how to sor this. thanks !!
justdivinegiftsangela
·2 months agothank you so very much - it is a lot to get my head around but I will keep at it. I cannot thank you enough for going to all this trouble to explain everything. I am an older lady and have always used pen and paper so a this digital millarky is a mine field to me - I was considering an account but as my profit margin is not that great these days (sales have greatly decreased) I cannot justify the cost. I have done my own accounts using manual ledgers and using the cahs basis rather than the accrual method when reporting to HMRC. God Bless You!
sheba-knows-best
·3 months agoHa - I just checked FY 2025, ebay sales less ebay costs had me at at 60,150. My spreadsheet reckoned 60,054. Gotta love a spreadsheet 😋
I think I'll stick with my spreadsheet - I know its as accurate as I can manage - whereas trying to make sense of all the comings and goings with ebay is ridiculous. For 2-3 years when I really pushed hard at the VAT threshold I used to check my 365 days sales total weekly and would notice in December there was always a sudden weird leap - where ebay reckoned I was about 2-4k higher in sales than I did - and it always came out of nowhere - only for it to disappear again. I could never figure it out - but I'd hate to be inputting figures like those on MTD only for ebay to reverse them....
maturin.surprise
·4 months agoYeah, there really is no need whatsoever for accountants for a lot of sole traders. You're literally just burning money instead of spending 30 minutes a week keeping a spreadsheet up to date and sticking to some very basic self-assessment procedures each year (you don't even need to be advanced in any way to do it). I've been doing it myself for over 10 years and there's nothing to it - I think people rather overplay the complexity of it. Some of the accountancy fees I hear people pay for just basic record-keeping are mind-boggling.
That old soundbite of "accountants saving you more money than it costs to hire them" only applies when significant volumes of money are concerned. Although no doubt they rub their hands together with glee when small sole traders ask for them to do their accounts!
sheba-knows-best
·4 months agoI have an extremely detailed spreadsheet. Ask me anything... % of sales in PL? % of sales in asset costs? my hourly income? Amount of time on each item averaged over the year? Returns rate? Losses YTD on returns? % of sales excl-ebay costs? etc etc etc All tallied as I go YTD and compared y-o-y for last 15 years. It's why my business has thrived despite tough times and a voraciously hungry eBay.
But I still think my accountant cost me hundreds and saved me thousands.
watchfan700uk
·4 months agoI understand about 4 returns from april 2026 for MTD.
Is this for the year ending april 2027?
What about my return for year ending april 2026? Is that submitted in the normal way?
sheba-knows-best
·4 months agoYes - my understanding is that YE this April 2026 is submitted in the normal way.
simplyessential_uk
OP4 months agoDepending on your previous years turnover if it was £50k then you are in the 25-26 if its under £30k then its 2026-27 - You sign up to one of the free softwares and submit 4 quarterly returns but the 5th is your final return and done the same way as always
padanpcparts
·5 months agoI literally bought a bottle of whisky to celebrate this weekend after finding out I don't have to do it for another year.
sheba-knows-best
·5 months agoI delayed until now because I kept expecting HMRC to roll back on this. They reckon there are @ 864,000 qualifying people for MTD this year. That's quite a lot of people to be having a melt down (although I know some will adapt easily, some accountancies will offer services etc). But I bet a fair few will continue to procrastinate until 7 Aug (when first quarter due) and... oh my....
Might HMRC hold the 50k level for another year or so?
fribblecollectables
·5 months agoThanks to simplyessential_uk for the help you have given on this thread.
I went for ClearBooks based on your answers and having had a bit of a play around, it seems to be fine for me.
I have a comprehensive spreadsheet I designed myself anyway with all my info I need.
Generally once a year it is simply a copy / paste of figures for the tax return, so hopefully the same for this.
I buy stuff and sell it. I have no desire to make it any more complicated than that !
sheba-knows-best
·5 months agoYes - despite me still finding it a tad tricky - I would like to echo Fribble. I don't know where I would have been without @simplyessential_uk Thanks soooo much x
simplyessential_uk
OP5 months ago@fribblecollectables @sheba-knows-best Youre welcome. I sympathise with so many who are not computer literate.
@sheba-knows-best asyou say youre not sure where your accountant steps in.... well maybe time to save yourself some money! They will still do year end but If youre entering all the figures etc then youre doing alot of the work. Ive never had an accountant as my books are straight income and expenses.
Ps folks dont forget to add in all other expenses each month for travel, utilities, phone etc as you cant add that at the year end, must be in the quarters as expenses.
sheba-knows-best
·5 months agoI am considering that but I always found the accountants knowledge of 'writing off' %s due to use of my washing machine, rooms of my house, share of personal mobile etc well worth their fee. I know I can keep bills. But if the rules change I don't want to have to waste my time reading updates on accountancy rules.
simplyessential_uk
OP5 months agoI found out info on AI (while i was doing all the CB research) of what i can claim for 😉 I hadnt been putting enough % through for utilities, which an accountant would of, so I agree in the past that knowledge was what you paid for, but the £300+ cost of an accountant was approx what id missed in "write offs"
re your reply to @padanpcparts I wanted to work with this early but couldnt find a "compatible" free software, at the time of this post, CB wasn't on the hmrc website of compatible softwares and only paid ones. My present software, id been using, said they wouldnt be compatible until after April, which is why, when posting this question I was searching for advice but waiting till April (for me) was too stressful and knowing what I experienced starting CB im glad I didnt. Im also with Starling bank and they haven't yet rolled it out the software that I can use for free (keep sending me info that its on its way) I read HMRC were planning to roll out the software but that was changed to 3rd parties so I can only presume this has caused the delay in finding compatible softwares early.
I spoke to my dog groomer before Xmas and again wks ago, she was so nonchalant and shrugged saying she hasnt even looked at it yet, she didnt even realise it was quarterly, but her Monzo bank are doing a software soon so may look at that, so i think this lack of preparation (by companies and users) is really going to hit. If many softwares arent going to be ready til April, many may not even be aware of the Aug deadline for 1st quarter so either HMRC. Also those with accountants may presume they'll do it (maybe they will for a fee)
I bet these boards will be busy in August 😆
sheba-knows-best
·5 months agoYup - I'm considering the saving by not having my accountant as offsetting what they would save me
Yup - I had kept in touch with my accountants throughout and they kept saying we'll let you know as soon as we have a plan. They finally put forward a plan: (1) you need to find your own software, then we'll submit quarterly for you (they have yet to answer my email reply as to what that will entail, will they add 'offsetting stuff' at that point), and (2) if you choose Xero or Sage we can help you keep your own records at a cost of £50 + VAT per hour with a minimum charge for any phone call or email of 12.50 + VAT. I was NOT impressed.
simplyessential_uk
OP5 months agoBlimey I bet youre not - My understanding is if you can justify it as an expense you can claim it - Ive just found my chat with AI I had when I was setting up my CB - Asked it was tell me what I can claim for as expenses re utilities and my business etc but Interestingly I just asked on the thread - If I use an accountant will they put in the full year or must I still include quarterly
1. If You Use the "Actual Costs" Method
If you decide to claim the actual business proportion of your bills (e.g., 20% of your total phone bill), here is the reporting flow:
Quarterly: You (or your software) will report the total business-related portion of those expenses in your quarterly updates.
Example: If your phone bill is £100 for the quarter and you know 50% is business use, you report £50 in that quarterly update.
The "Accountant Shortcut": HMRC has stated that quarterly updates do not require full tax adjustments. This means you could technically report the total bill in your quarterly updates and have your accountant "tidy it up" (apply the private-use reduction) at the end of the year in the Final Declaration.
The Catch: If you don't adjust for private use quarterly, the "Estimated Tax" figure HMRC shows you in your account will be wrong because it will look like you have more expenses (and thus less tax to pay) than you actually do.
2. If You Use the "Simplified" (Flat Rate) Method
Quarterly: You calculate how many hours you worked from home that quarter and include the corresponding flat rate (e.g., £10, £18, or £26 per month) in your quarterly update.
End of Year: There is usually nothing to "tidy up" for this specific expense since the flat rate is already a fixed amount.
3. Can My Accountant Just Do the Full Year at the End?
No. This is the biggest change with Making Tax Digital.
Even if you have an accountant, the 4 quarterly updates are a legal requirement. You cannot skip them and just do one big submission at the end of the year.
What you do: You must keep your digital records (e.g., scan receipts into an app or use a spreadsheet) throughout the year.
What your accountant does: They will likely log into your software every three months, check your figures, and hit "Submit" for you.
The Final Step: After the four quarters are done, your accountant will then do the Final Declaration (the 5th submission), which is where they add things like bank interest or dividends and make the final "professional" adjustments to ensure your tax bill is exactly right.
Seems you are expected to do all the work and they are pressing the button quarterly (ensuring you have done it right) then do the 5th final submission - If yours is a straight forward income V expenses business you maybe paying for them to press a button with this new MTD.
Good luck
sheba-knows-best
·5 months agoAnd just for the record - whilst I feel a tad better myself (albeit it still lost as to how the accountant gets involved) - all the time I was screaming at the computer yesterday, I was also thinking what about gardeners, plumbers, joiners (not to pick on the manual skills, but hey); basically all of the people who have had jobs that don't involve much work on a computer or with a spreadsheet and don't even get terms like gross, net, income, turnover, profit etc? This also includes maybe retired people who let out a house.
I chose Clearbooks because everything seemed to say it was the easiest system. Well, I spent 21 years in a bank analysing accounts, and I've had 14 years on eBay and it wasn't easy for me. And I agree there wasn't much help on youtube and AI was too generic. I think the proverbial is gonna hit the fan in April. How HMRC thought this is a good idea is beyond me.
sheba-knows-best
·5 months agoOkay I found it. In my opinion not intuitive. You have to click on a reference number. Not the box where the amount is. It takes you to a whole new screen. And there there is the VOID button. If anyone is following this... and wants help... PM me.
@collectablecats thanks for making me stop trying to edit the figure anyway 😃
Also anyone else following this...top right of clearbooks dashboard is a ? and that is where you will find guides (which is where I found this).
I am a technophobe and technocastrophizer, so take this with a pinch of salt... but anyone who has to start this from April I would start having a look asap...
simplyessential_uk
OP5 months agoIf youre using bank feeds those help pages arent helpful for ebay/amazon etc where we get paid "payment" not sales. You have to go into bank accounts, add cash pot and transfer payments into there, then from that pot pay into the ledger the month end sales and fees. I reset 5 times, youre right, its not intuitive but I figured its geared to accountants and my brain just isnt😆 After using it 6mths its very easy now.
Just check each months correct >click on reports > profit loss and you can click of revenue/costs etc and it will show you each amounts in the boxes, ive put in wrong day many times and see amounts pop in wrong column, which is why its easier if you put in the description which month it's for then easier to move to correct month.
sheba-knows-best
·5 months ago@simplyessential_uk
Thanks for messaging.
I tried linking bank accounts and found that overly complicated given that I'm still aiming to gradually wind down my online selling. So I'm aiming to stick with manual entry. (Especially as I already have all the figures I need on my excel spreadsheet so it's just a point of data-entering one sales figures per week and a handful of expenses).
Thanks for heads up on reports tab. I hadnt got to that yet. Given my Excel sheet is a marvel 😀 it will be nice to check that Excel and Clearbooks agree...
sheba-knows-best
·5 months ago@ojewellery
I do appreciate the help OJ - but I have been taking advice from chat gbt for most of the afternoon - which is why I feel such a dimwit. I just cant find an ability to edit/delete an income or expense once you have saved in Clearbooks. I can't help feeling I'm being stupid which is why I wondered if there was some kind of magic 'unlock' button I was missing. Maybe it will all become clear tomorrow.
Tagging in @simplyessential_uk just in case you know what I'm on about.
writesoon
·5 months agoI’m not sure there is a way of changing the amount you have saved for a transaction in Clearbooks.
i may have missed something, but I think if you make the kind of mistake you are talking about, you’ll need to delete that transaction and then add it again with the correct details. If you notice the error the follwing day, you can still enter the correct date for that particular transaction from the drop-down.
sheba-knows-best
·5 months agoThank you. But I cant find delete either? I sound stupid even to my own ears. I seem to have to start the whole business again to delete even just one transaction?
I think maybe I was rushing yesterday and will try again and remember to breathe....
My aim is not to input each sale btw - but to manually record total income, total expenses either by the month or week. So I won't be making loads of errors. It just seems weird that deleting/revising is hard.
simplyessential_uk
OP5 months agoYou cant edit a manual entry, you have to delete it (void)
to remove an entry just click on the income box, sits to left (If your entering manually) or find the entry in you bank feed.
In the income box you'll see the column invoice number in blue (start rec00) click on that and press void, annoyingly you cant edit (maybe you can in the subscription package) so youre not missing it, it baffled me initially.
if its your bank feed that youve allocated wrong then above method works also but can click on the blue numbers of the entry > delete, this puts the entry back into the "unexplained" to redo, but if you do it wrong and notice straight away, you can undo by clicking the red backwards circle symbol in the feed.
sheba-knows-best
·5 months agoOh and thanks for this too - I wish I'd come here sooner (yesterday) rather than tearing my hair out and thinking about it all night.
simplyessential_uk
OP5 months agodont worry I replied this morning so you would of still had the sleepless night 😆 Honestly when I was setting ut up and trying to link up bank feeds I was at it for 4 days solid, it drove me mad. No help on the CB help pages or YTube that relates on how to manage ebay/amazon as its not direct sales and i had to have conversations witn AI for days to try and understand how to make it work as it wouldn't tally. On day 4 I finally made it tally and I whooped out loud that my daughter came out of her room to check (she knew how long it was taking me) 🤣 Now its easy but You are not alone in trying to get your head around it
sheba-knows-best
·5 months agoWell I wasted maybe 6 hours yesterday. And maybe 4 today. Plus £6 because clearbooks ate my subscription when I 'reset' my business for the umpteenth time 😁 Possibly the fee will never be taken. Possibly I will subscribe again. I'll take the hit.
I'm still waiting to hear back from my accountant as to how they want to deal with inputting their accountancy knowledge on stuff like use of rooms, car, petrol etc.
Do you use an accountant or do it all yourself?
simplyessential_uk
OP5 months agonot sure why you'd pay a £6 subscription 🤔 its free.
sheba-knows-best
·5 months agoBecause when I couldn't get the darn thing to work, I thought maybe my inabilities were due to not linking my bank account and I thought that would maybe be the way to go. And for £6 I thought what the hell. It solved nothing! So I reset the business... only I didn't reset, I accidentally closed... and by closing I lost my £6... did I tell you I was crying in the kitchen??? Like I say... It was a bad day 😅
ojewellery
·5 months agoFrom chatgpt:
If you mistype something in Clear Books before submitting the MTD update, you can correct it. You do not need to delete and re enter unless the transaction structure itself is wrong.
For a non VAT registered seller, this is straightforward because you are not dealing with VAT codes or VAT returns.
If it is just a typo in amount, date, description, or category
Open the transaction
Edit the fields
Save again
Clear Books will update the totals automatically. There is no issue as long as the period has not been submitted.
If the transaction was entered incorrectly in principle
For example
• entered as income instead of expense
• wrong account category
• wrong bank account
You can still edit it if it is not locked.
If the period has been submitted to HMRC
Then you generally cannot edit transactions in a locked period.
You would instead:
• Enter a correcting transaction in the next period
or
• Unlock the period if your settings allow it
For MTD Income Tax, corrections are usually reflected in the next quarterly update if already submitted.
When would you delete and re enter?
Only if:
• The transaction type itself is wrong and cannot be edited
• You attached it incorrectly to another record
• The edit function is restricted
Otherwise editing is perfectly acceptable and keeps your audit trail clean.
sheba-knows-best
·5 months agoWhat I mean is if you accidentally type 200.00 instead of 2000.00 there has to be an edit surely?
sheba-knows-best
·5 months agoOkay but the same applies. My question - after you've inputted an income (even if it is my weekly or monthly sales) what if you mistype and need to edit? There seems no delete or edit function. I agree I must be missing the obvious. But I've spent hours and can't find it.
On the flipside... my daughter (17) aces all her business exams, has called me a dinosaur, stated that HMRC would NOT make it this hard, and has offered to do it for me when she gets home from school tomorrow.
I will either be here eating my hat or I will be back for a rant.
sheba-knows-best
·5 months agoOkay I am at my wits' end and feel like an idiot.
So I decided to use Clearbooks for free.
I decided initially I would just enter an ebay sale as 'income'.
I decided I would enter the related expenses: asset price, Ebay FVF, ebay PL fee, Postage.
All good. I could see my profit.
But then I thought - okay what if I had entered the figure wrong. Or if the customer suddenly cancelled. What if I need to edit this info.
There seems to be no option to delete or edit income/expenses when you manually input? No way.
SO even if I decide to do things monthly as opposed to do per transaction there's no delate or edit function?
Please tell me I'm missing the obvious...
ojewellery
·5 months agoI think possibly, you're overthinking it.
I typed in my understanding to chatgpt and asked it to verify for a non VAT registered trader this is how it articulated:
If you are not VAT registered and you are using Clear Books under Making Tax Digital for Income Tax, you are reporting income and expenses totals for each period, not individual invoices.
So when something changes such as a refund, credit note, or returned sale, the treatment depends on timing.
1. If the refund happens in a later month
You include it in the month it actually occurs.
Example:
January sales reported: £5,000
February: customer refund £200
You do not go back and amend January.
You report February income as reduced by £200.
This keeps everything on a cash basis if you are using cash accounting, which most non VAT registered sole traders do.